I. EMPLOYMENT LITIGATION

Supreme Court Decision Makes It Harder to Prove Age Discrimination Under the ADEA.

Gross filed suit in District Court, alleging that his reassignment to the position of claims project coordinator violated the ADEA. The case proceeded to trial, where Gross introduced evidence suggesting that his reassignment was based at least in part on his age. FBL defended its decision on the grounds that Gross' reassignment was part of a corporate restructuring and that Gross' new position was better suited to his skills.

At the close of trial, and over FBL's objections, the District Court instructed the jury to enter a verdict for Gross if he proved, by a preponderance of the evidence, that he was demoted and his age was a motivating factor in the demotion decision, and told the jury that age was a motivating factor if it played a part in the demotion. It also instructed the jury to return a verdict for FBL if it proved that it would have demoted Gross regardless of age. The jury returned a verdict for Gross. The Eighth Circuit reversed and remanded for a new trial, holding that the jury had been incorrectly instructed under the standard established in Price Waterhouse v. Hopkins, 490 U.S. 228, 109 S.Ct. 1775, 104 L.Ed.2d 268, for cases under Title VII when an employee alleges that he suffered an adverse employment action because of both permissible and impermissible considerations-i.e., a "mixed-motives" case. On certiorari, the parties asked the Supreme Court to decide whether a plaintiff must "present direct evidence of discrimination in order to obtain a mixed-motive instruction in a non-Title VII discrimination case."

Before reaching this question, however, the Court analyzed whether the burden of persuasion ever shifts to the party defending an alleged mixed-motives discrimination claim brought under the ADEA. Petitioner relied on the Court's decisions, such as Price Waterhouse and Desert Palace, Inc. v. Costa , 539 U.S. 90, 94-95, 123 S.Ct. 2148, 156 L.Ed.2d 84 construing Title VII for his interpretation of the ADEA. However, the court noted that "[u]nlike Title VII, the ADEA's text does not provide that a plaintiff may establish discrimination by showing that age was simply a motivating factor." The court held that because Title VII is materially different with respect to the relevant burden of persuasion, these decisions do not control the construction of the ADEA.

The Court then turned its inquiry to the text of the ADEA to decide whether it authorizes a mixed-motives age discrimination claim. The ADEA provides, in relevant part, that "[i]t shall be unlawful for an employer ... to fail or refuse to hire or to discharge any individual or otherwise discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual's age." 29 U.S.C. § 623(a)(1) (emphasis added). The Supreme Court has held that the ordinary meaning of the ADEA's requirement that an employer took adverse action "because of" age is that age was the "reason" that the employer decided to act. The court provided:

To establish a disparate-treatment claim under this plain language, a plaintiff must prove that age was the "but-for" cause of the employer's adverse decision. It follows, then, that under § 623(a)(1), the plaintiff retains the burden of persuasion to establish that age was the "but-for" cause of the employer's adverse action . . . .We have no warrant to depart from the general rule in this setting. Hence, the burden of persuasion necessary to establish employer liability is the same in alleged mixed-motives cases as in any other ADEA disparate-treatment action. A plaintiff must prove by a preponderance of the evidence (which may be direct or circumstantial), that age was the "but-for" cause of the challenged employer decision.

Finally, the Court rejected petitioner's contention that the proper interpretation of the ADEA is nonetheless controlled by Price Waterhouse, which initially established that the burden of persuasion shifted in alleged mixed-motives Title VII claims. The Court noted that "[t]he problems associated with its application have eliminated any perceivable benefit to extending its framework to ADEA claims."

The Court, therefore, held that a plaintiff bringing a disparate-treatment claim pursuant to the ADEA must prove, by a preponderance of the evidence, that age was the "but-for" cause of the challenged adverse employment action. The burden of persuasion does not shift to the employer to show that it would have taken the action regardless of age, even when a plaintiff has produced some evidence that age was one motivating factor in that decision.

Plaintiffs Cannot Rely On Evidence That a Supervisor Was Aware of Alleged Sexual Harassment, But Instead Must Show That a "Management Level" Employee Was on Notice.

In Huston v. Procter & Gamble Paper Products Corp., --- F.3d ---, 2009 WL 1587649 (June 8, 2009), plaintiff, Priscilla Huston, brought a Title VII suit for sexual harassment and retaliation against her employer, Procter & Gamble Paper Products Corporation (P & G). Plaintiff worked as a technician on the teams that operated large paper manufacturing machines. Plaintiff complained that her male teammates had exposed themselves and looked at pornography on the company computers. According to plaintiff, supervising technicians Pete Romanchick and Jack Traver were informed of at least one of the alleged incidents. At the conclusion of the investigation, each of plaintiff's teammates were disciplined. Months later, P&G terminated plaintiff's employment when she admitted to falsifying machine log data.

Plaintiff filed a complaint against P & G in the Middle District of Pennsylvania asserting claims for sex discrimination and retaliation under Title VII and under the Pennsylvania Human Relations Act (PHRA). The District Court granted summary judgment against plaintiff. Plaintiff appealed from that judgment.

On appeal, the court identified the five elements a plaintiff must establish to prove that an employer violated Title VII by proving that sexual harassment created a hostile work environment: (1) the employee suffered intentional discrimination because of their sex; (2) the discrimination was pervasive and regular; (3) the discrimination detrimentally affected the plaintiff; (4) the discrimination would detrimentally affect a reasonable person of the same sex in that position; and (5) the existence of respondeat superior liability.

The first four elements of this claim establish that a hostile work environment existed. The fifth element, which is the only element at issue in this appeal, establishes the basis on which to hold the employer liable. The basis of an employer's liability for hostile environment sexual harassment depends on whether the harasser is the victim's supervisor or merely a coworker. In this case, plaintiff conceded that the employees who performed or witnessed the alleged harassing incidents were not supervisors; all were co-worker technicians.

An employer may be directly liable for non-supervisory co-worker sexual harassment only if the employer was negligent in failing to discover the co-worker harassment or in responding to a report of such harassment. Plaintiff argued that P&G knew or should have known of harassment through the technicians Romanchick and Traver and that P&G failed to take prompt and appropriate remedial action.

The court explained that an employer knew or should have known about workplace sexual harassment "if management-level employees had actual or constructive knowledge about the existence of a sexually hostile environment." The court also recognized that management level employees have constructive notice of a hostile work environment when "an employee provides management level personnel with enough information to raise a probability of sexual harassment in the mind of a reasonable employer.'

Plaintiff argued that Romanchick and Traver were management level employees because they held the supervisory positions, and they had the authority to "turn in" employees who were in breach of plant policies. In deciding whether Romanchick and Traver qualified as management level employees, the District Court observed that the Third Circuit "has given little guidance as to what "management level" exactly means in the context of imputing constructive notice of co-worker sexual harassment to the employer." As such, the Third Circuit took this appeal as an opportunity to offer some guidance to the district courts as to who qualifies as a "management level" employee.

The court applied principles of agency to interpret Title VII, as directed by Congress. The court found that the relevant agency principles to apply in this case are those governing when to impute an agent's knowledge of particular facts to the agent's principal. The court cited the Restatement (Third) of Agency which provides that there are two parameters limiting when knowledge of facts known by an agent is imputed to the principal.

First, the Restatement provides that "[t]he scope of an agent's duties delimits the content of knowledge that is imputed to the principal." Under this approach, a corporation is not charged with the legal consequences of an employee's knowledge of a fact that lies outside the scope of the employee's duties to the corporation. Second, the Restatement provides that even if knowledge lies within the scope of an employee's duties, to justify imputation, the knowledge must also be material-i.e., important or significant-to the employee's duties to the employer. Under this approach, an employee's knowledge of sexual harassment may be imputed to the employer when the employee is employed to report or respond to sexual harassment.

Based on the Restatement, the court concluded that an employee's knowledge of allegations of coworker sexual harassment may typically be imputed to the employer in two circumstances: first, where the employee is sufficiently senior in the employer's governing hierarchy, or otherwise in a position of administrative responsibility over employees under him, such as a departmental or plant manager, so that such knowledge is important to the employee's general managerial duties." Second, an employee's knowledge of sexual harassment will be imputed to the employer where the employee is specifically employed to deal with sexual harassment. Typically such an employee will be part of the employer's human resources, personnel, or employee relations group or department.

In the instant matter, the court agreed with the District Court's conclusion that Romanchick and Traver did not qualify as management level employees. The court noted that their responsibilities focused on the mechanical operation of the production line and they had no authority to affect the employment status of their teammates. Finally, the court found that plaintiff's own actions indicate that she knew and understood the hierarchy at the plant and the fundamental difference in the duties of managers and technicians. When she decided to lodge a formal complaint on June 30, 2004, she approached managers-not Romanchick or Traver. As such, the court held that "the record compels the conclusion that Romanchick and Traver were technicians and not management level employees for purposes of imputing to P & G their knowledge of potential co-worker harassment.'

Employers Precluded From Inquiring Into Employees' Immigration Status During Depositions

In Serrano and Vivar v. Underground Utilities Corp., --- A.2d ---, 2009 WL 1395418 (N.J. Super A.D. May 20, 2009), immigrant employees who furnished labor on construction projects filed class action against employers, asserting violations of federal Fair Labor Standards Act (FLSA) and New Jersey Prevailing Wage Act (PWA), as well as other claims. The named plaintiffs, Serrano and Vivar, were immigrants from Ecuador. Many or all of the other class members were originally from Central or South America. At the time of its filing, the complaint alleged that Serrano resided in Ridgewood, New York, and Vivar resided in Newark, New Jersey.

The pivotal discovery issues before the court concerned the workers' immigration status which arose during the depositions of Vivar and Serrano. During both of those depositions, defense counsel made repeated inquiries of the named plaintiffs to elicit information about their respective residency and immigration status. Many of these questions drew objections from plaintiffs' counsel, who eventually sought the intervention of the trial court. Defense counsel asserted that he was delving into these subject matters only to explore issues of the plaintiffs' credibility, and not out of any specific intent to uncover or litigate their immigration status.

As the result of defense counsel's inquiries into these subjects, Vivar and Serrano provided certain responses that were either internally inconsistent or were inconsistent with documents presented to them at their depositions. Based on these inconsistencies, defense counsel asserted to the deponents that they were not telling the truth about matters concerning their residency and immigration status, accusing them multiple times of "lying."

Plaintiffs' counsel sought a protective order barring defense counsel from pursuing further discovery from either the named plaintiffs, or any of the other class members, concerning their immigration status. Defense counsel argued that all the information he intended to illicit regarding the immigration status was reasonably calculated to obtain relevant evidence bearing upon plaintiffs' credibility. The motion judge entered a protective order allowing defense counsel to ask twenty questions regarding plaintiffs' immigration status. Plaintiffs appealed.

The court assumed, for the sake of argument, that members of the putative class of plaintiffs who were undocumented or illegal workers may be entitled to back pay for work already performed-as a remedy for any proven violations of the FLSA or the PWA. The court then addressed Defendants' intended aim to impeach plaintiffs' credibility with proofs of prior inconsistent statements about their residency, Social Security numbers, and the like. The court noted that such impeachment with specific instances of untruthful conduct was prohibited under Evidence Rule 608(a), which provides:

The credibility of a witness may be attacked or supported by evidence in the form of opinion or reputation, provided, however, that the evidence relates only to the witness' character for truthfulness or untruthfulness, and provided further that evidence of truthful character is admissible only after the character of the witness for truthfulness has been attacked by opinion or reputation evidence or otherwise. Except as otherwise provided by Rule 609 and by paragraph (b) of this rule, a trait of character cannot be proved by specific instances of conduct.

The court also referred to Evidence Rule 607 noting that while the Rule provides authority for "extrinsic evidence" of untruthful conduct to be used to impeach a witness's credibility, it does not specify, with precision, the kinds of "extrinsic evidence" relevant to credibility that may be admitted under that Rule. As such, the court evaluated associated commentary from the Supreme Court Committee and related case law and found that, viewed collectively Rules 607 and 608 operate to prohibit defendants from using prior false statements by plaintiffs about their immigration status as specific instances of past untruthful conduct in order to show a general character trait of dishonesty.

Therefore, the court rejected defendants' position that the discovery of any immigration-related information that "bears upon plaintiffs' credibility is, as a per se matter, fair game." Such an unlimited approach deficiently ignores the adverse potential chilling effect upon immigrant workers that we have already described, and the potential for inflammatory prejudice at the time of trial. Further, the court sustained the motion judge's ruling precluding the defense from insisting upon the current residential addresses of each plaintiff. The court provided "given the nature of the issues in this case and the apparent immigration status of most or all of the workers involved, we discern no necessity for those workers' most current residential addresses to be supplied to defense counsel after the initial pleading."